Q&A – with Pia Olsen Dyhr, Danish Minister for Trade and Investment

Why is Denmark among the most successful countries globally in cleantech?It is surely a combination of many factors, but two are particularly important. The first: consecutive national energy strategies for the last 30 years have been rooted in a broad political consensus, removing uncertainty—the worst enemy of investors. The second: dedicated and strong government support for renewable energy technologies at their early stages, always keeping an eye on the relation between subsidies and the decreasing investment costs, due to a rapidly declining learning curve. This has given Denmark a leading position on global cleantech. Denmark has just been named number one on the WWF/Cleantech Group’s Global Cleantech Innovation Index 2012 and we are proud of being the best country in the world on green innovation. We intend to keep our lead in order to maintain our jobs and business, but also to ensure the environment for the future.

Does Denmark’s size pose a limit to its cleantech industry?At first glance one could think that a small country has a clear disadvantage that would keep investors away, but Denmark has turned that into a competitive advantage. Danish companies must go global at a very early stage, in order to scale up. They must be equipped to compete on the global market. Denmark is also an obvious choice when establishing business in Northern Europe, as the bridge between Scandinavia, the Baltic countries and the UK and continental Europe. And Denmark is a member of the European Union. The EU is our home market – the largest home market in the world.

How has the government supported Denmark’s cleantech sector?New cleantech solutions need support schemes to be profitable. We have seen that with wind energy which we have supported for decades. Presently 25 percent of our electricity supply originates from wind. We plan to have 50 percent wind energy in the grid by 2020. We are almost at a stage where on-shore wind can compete with conventional energy. Our long-term political commitment has played a major role in putting our cleantech sector in front. This is not only in wind, but also in bio-energy, hydrogen and fuel cells and other technologies that benefit from our political commitment to the green economy.

How critical has been the level of R&D spend on cleantech in Denmark?Denmark spends approximately 3 percent of its GDP in R&D, one of the highest rates in the OECD. One third of this investment is public expenditure and a large share of this investments goes to cleantech projects. Denmark does not have many natural resources. The only one that we can be certain that will not run out – besides wind – is people. We nurture this resource by investing heavily in education. We support and invest in R&D projects, often in direct relation to pilot and demonstration plants.

Will investment in the clean tech sector continue to grow in Denmark?The government´s new energy strategy has an ambitious target to make Denmark the first fossil-free country in the world by 2050. This will require massive investments in the energy sector, both in wind energy, biogas, biomass and many other clean technologies. We will also need new power transmission and distribution lines, including new interconnections to our neighboring countries. Our transport system is also moving away from fossil fuels to EVs and other renewable transportation.